Wal-Mart vs Itself

A typical Wal-Mart discount department store i...

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Wal-mart ($WMT)a few years ago, in the worst of the economy tried a restructure in it’s plan. They lowered store inventory,  launched another store brand, re-branded it’s logo, and tried to increase some quality of products and foods. In the past two years, the stock is up 10% and increased it’s dividend to 2.2%.  Sounds good, right? The stock took a dive today as it’s numbers came out less than expected to the Street’s standards. What happened, did they miss something? Yes! While #WMT was chasing the consumer, smaller and more convenient stores like Family Dollar ($FDO) started taking it’s market share who is up 56% over the past two years. Target ($TGT) is up 63% in 24 months. People were looking for lowest price, better service, and quicker shopping. While Wal-Mart tried improving quality and increasing some prices, consumers went with the small shop. Now, #WMT is going back to having lowest cost.  They confused their shoppers. Some things are better quality, some fall apart, some cost less, some is expensive, there’s no one to help in the store, and the stores are so big that people are getting less satisfied with the overall shopping experience. While Wal-Mart is figuring out their direction, the Family Dollar and Target customers are happy with there new retailers. The time of being herded in and out of the stores are over. People need the best bang for their buck and and best experience for their time. The winds will change, the heading shouldn’t. The hard focused Target and Family Dollar are proving this.

-Benjamin Horbowy